The Treasury Secretary chimes in on what any market
watcher should know instinctively. Mnuchin talks tech: 'I don't understand these valuations', yet the price on promises and future expectation of earnings has a large amount of the equity speculators and computerized
trading in a crisis of sanity. Avoiding the fundamental relationship that a stock value is based upon the ability of a company
to turn a profit, has become the hottest investment hoax since Bernard Madoff was pitching his Ponzi scheme. Uber, Snapchat and Twitter may be high flyers for the smart set, but for rational venture capitalists, plunking down gambles on risky enterprises that
only feed on publicity hype is a sure bet on going broke.

While angel funding, seed investment and incubation have a nice ring to their functions, what they all have in common
is gaining a piece of the equity action before any IPO is sold to the investment insiders, much less the general public. What
is often lost is that any new startup enterprise must develop cash flow well before any earnings can be achieved.

Defying common sense, many of this new generation
of cutting edge technology companies are pitching a dream that often turns into a nightmare for the imprudent investor. At
least Apple sells, admittedly very overpriced phones, a product that has a functional and utilitarian purpose. But what possible
claim of intrinsic worth does a trendy app have when duplication of utility is achieved by a tech giant as Facebook?

Even the most bombastic huckster, Elon Reeve Musk
finds himself reliant on the intrepid waters of government subsidies to keep his bubble run on solar cells, alive. Yet his
stock price keeps inflating with little financial connection to turning a profit, even when Sparks fly on Wall Street over Tesla’s current valuation.

"For
now, Musk and his team have built up enough investor goodwill to buy him time to follow through his vision. Tesla narrowly
missed its target of delivering 80,000 vehicles last year and has only reported two profitable quarters in its brief history.
Nonetheless, its rapid rise could see it accelerate past Honda and move into the top five most valuable carmakers in the world.

This comes as the finances
of Ford and GM are in rude health. GM is expected to earn more than $9bn this year and Ford to rake in profits of $6.3bn;
Tesla is expected to lose more than $950m."

Come on folks, in what mystical world of consumer sales indifference does one accept that in the immediate future
buyers will jump from the torque of a four wheel drive F-150 V-8 into the restriction of a Tesla electric cord? In order to
make this fantasy work Road and Track contends, The Case for a Tesla-GM Merger. The argument simply comes down to "You put together a carmaker with mojo and a carmaker with capacity."

"We live in an era
where brick-and-mortar companies frequently play second fiddle to apps and platforms and clouds and other entirely ephemeral
ideas. It suits the stock market just fine, because the stock market is much like the baseball-card market, or the art market,
in that it serves more as a reflection of prevailing views than as any truly prescient or even intelligent verdict regarding
a company's merit. It's an illusion. Of course, it is an illusion with the power to build fortunes and destroy lives in a
millisecond."

When government motors
was bailed out by the Obama administration to save the unions while wiping out the bond holders, GM was given a second chance
at the taxpayer expense. Now we are suppose to accept another rescue of Tesla debt to keep the illusion that the future belongs
to the driverless "green" vehicle. Hey, why not just go all the way; ban humans from using gas guzzlers on the highways,
while taxing a per mile user fee to replace the gas tax? Just keep diesel commercial trucks to navigate the steep grades to
fix all the infrastructure that driverless vehicles will use.

The absurdity of this brave new world is as obscene as the stock prices of the technocratic anti-human
robot society that is facing an expendable population. Nonetheless, do not take our analysis for the last word. Look to the
essay in The Street, From the Absurd to the Ridiculous: When Fundamentals Don't Matter, where the example of Yahoo is reviewed.

"Yahoo! (YHOO) , which was a highly valued company during the dot-com era.

When looking at Yahoo!'s
price and P/E ratio, the fundamentals didn't really reflect the stock price. Yahoo! was trading at nearly 3,500 times its
P/E ratio at one point, which may have been unjustified.

Following that, the markets were quick to realize that the company wasn't that
valuable, and it began to tank once the bubble popped.

Take a look at how Yahoo!'s market capitalization evolved over time. Prior to the dot-com
bubble, Yahoo! had a market cap of less than $1 billion.

However, during the bubble, Yahoo!'s market cap rose to more than $100 billion
at its peak. Thereafter, its market cap and share price fell significantly, with the former falling to between $5 billion
and $10 billion."

If such a stable
of the computer age as Yahoo could be reduced to the humiliation of a hostile takeover by Verizon at a price not much more than an unknown startup as Team Chat provider Slack with a valuation of about $3.8 billion, what true value does any of these high tech ventures provide over time? Anyone remember
one of the scores of services from Yahoo called Messenger? Do the math, plunging down your bucks on such moving targets as
superficial fads is most risky.

Google
search beat out Yahoo, but will Alphabet retain the preeminent crown of dominance with their imposition of censorship and
filtering out of free speech? Stock values are never guaranteed and especially with tech companies, you are only safe if competition
is eliminated.